Safekeeping


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Safekeeping

The act of a brokerage holding a client's securities or other assets on his/her behalf. This reduces the risk of the client losing his/her assets or having them stolen. They are also available to the brokerage to sell at the client's demand. Like a bank, safekeeping provides an investor a place to store assets with little risk. Unlike a bank, brokerages are not allowed to use the items in safekeeping for their own ends. Assets in safekeeping are not fungible for the brokerage because they remain in the client's name; for this reason, brokerages normally require a fee for safekeeping services. See also: Street name safekeeping.

safekeeping

The keeping of assets, including securities, by a financial institution.

Safekeeping.

Safekeeping occurs when a broker-dealer holds securities that are registered in a client's name for the client.

The advantage from the client's perspective is that the securities are safe and the broker-dealer has them available to sell at the client's instruction.

The disadvantage from the broker-dealer's perspective is that securities held in a client's name are not fully negotiable or fungible, so they can't be used to settle trades, for example. Thus, it's a service for which many firms charge a fee.

Instead of being registered in their own names, clients' securities may be registered in the broker-dealer's name or in the name of a depository. That's known as being registered in street name or nominee name.

With this type of registration, the client's ownership rights are fully protected but the stock is fungible. The broker-dealer may use a limited portion of the holding to settle trades or for other purposes.

References in periodicals archive ?
A safekeeping fee is imposed on the customer for the storage service.
The Baker Group has a sterling reputation in the securities industry, and we are grateful for the firm's confidence in our securities safekeeping services," said Cliff McCauley, executive vice president, Correspondent Banking at Frost.
c) -- I am not in compliance with the trust account and safekeeping property rules.
I asked to speak to a supervisor and volunteered to rent an external MO drive for a few days, so I could offload my files for safekeeping.
The data, classified top secret, was maintained by the Joint Chiefs of Staff and in 1976 declassified and delivered to the National Archives for safekeeping.
Covering all major aspects of professional conduct, it includes information on: competence; scope of representation; diligence; confidentiality; conflicts of interest; safekeeping property; claims and judgments; expediting litigation; fairness to opposing party; publicity; lawyer as witness; fees; unauthorized practice; law reform activities affecting clients; advertising; contact with prospective clients; and, disciplinary matters.
Quite rightly considered precious works of art, these blocks were hidden for safekeeping during the second World War.
The apprentice-ridden two-ear-old looked to have the five-furlong Bruce Edwards Baldy Dash Novice Auction Stakes in safekeeping 200 yards from home but he was collared in the final strides by Halland Park Girl and went under by a neck.
This new controversy follows a television documentary report last year that the Vatican held 200 million Swiss francs, $170 million today, for Croatian fascists for safekeeping.
Definitive Safekeeping and Noncash Collection Services
Its complete range of international-standard services include safekeeping, settlements and processing, as well as managing assets for investment in the Lao Securities Exchange.
com)-- Global Trust Depository now appraises the value of your assets prior to safekeeping in order to ensure your complete satisfaction in the transaction.